holding that, where the contract contains an undertaking
on the part of the seller to replace any article found to be
defective or unsatisfactory, still the purchaser is not bound
to accept another article offered in place of the one first de-
livered, but may return what has been delivered and rescind
the contract.139 This, however, has been denied. In a case
in Iowa, a written warranty of a machine provided that if
it did not work satisfactorily or was defective, it should be
returned and the payments refunded, or another machine
supplied that would fill the warranty. Upon the return of
the machine by the purchaser as defective, he demanded the
unconditional return of his money. But it was held that
the vendor had the option either to return the money or to
supply another machine, and that a return and demand
which did not give him the opportunity to exercise this op-
tion was not effective as a rescission of the contract.14
140 But
after the buyer of a machine has definitely rescinded the
purchase, for failure of the machine to conform to the con-
tract, no subsequent act of the seller in so rebuilding the
machine as to make it conform to the terms of the sale will
bind the buyer.141

Whatever may be the correct rule for this class of cases, the right of the buyer to rescind for inferiority or defects is unquestioned where the seller definitely refuses to make good the defects on being notified thereof,142 or where he delays his efforts to remedy the matters objected to for an unreasonable length of time,143 or until after the buyer has made other arrangements and supplied the place of the rejected article,144 or where the seller's offer to make good comes at an unsuitable time, and a time when no sufficient test can be made of the efficiency of the article as repair

189 Bracken v. Fidelity Trust Co., 42 Okl. 118, 141 Pac. 6, L. R. A. 1915B, 1216; Bixler v. Dolieve (Tex. Civ. App.) 167 S. W. 1102. 140 Pitt's Sons' Mfg. Co. v. Spitznogle, 54 Iowa, 36, 6 N. W. 71. 141 Greene v. Curtis Automobile Co., 144 Wis. 493, 129 N. W. 410. 142 W. F. Main Co. v. Field, 144 N. C. 307, 56 S. E. 943, 11 L. R. A. (N. S.) 245.

143 Pittsburg Gas Engine Co. v. South Side Electric Mfg. Co., 43 Pa. Super. Ct. 485; Tufts v. Hunter, 63 Minn. 464, 65 N. W. 922. 144 Helm v. Loveland, 136 Iowa, 504, 113 N. W. 1082.

C

147

ed,145 or where the seller's attempts to correct the fault or make good the defect are unsuccessful,146 or where he offers to supply another article in place of that rejected, but demands more money for it than was originally stipulated to be paid,1 or where the sale was induced by fraudulent misrepresentations as to the quality and value of the property sold.148 But where goods are sold with a representation of good quality, and, on complaint as to their quality by customers of the buyer, to whom the goods were shipped without inspection, the seller agrees to make allowance therefor by credit on the account, this agreement is based on a sufficient consideration, and, if accepted by the buyer, will of course preclude rescission.149

Some contracts of sale, particularly in the case of machinery, contain provisions requiring the purchaser, in case the article proves defective or unsatisfactory, to give notice thereof to the seller, and afford the latter an opportunity to remedy the defect or replace the faulty article with a perfect one. These conditions are regarded by the courts as reasonable and proper, and a purchaser, taking property under such a contract, must at least substantially comply with what is required of him, in the way of giving notice and according an opportunity for adjustment or replacement, before he can claim the right to rescind.150 And if he specifies certain defects, and they are remedied, he cannot afterwards. rescind on account of further objections known to him at the time but not insisted on.151 On the other hand, if the purchaser gives due notice of defects and proper time is allowed for them to be remedied, but this is not done, he

145 J. I. Case Threshing Mach. Co. v. Puls, 175 Ill. App. 190. 146 Cole v. Laird, 121 Iowa, 146, 96 N. W. 744.

147 Desson v. Antony (Com. Pl.) 13 N. Y. Supp. 890.

148 Lyon v. Lindblad, 145 Mich. 588, 108 N. W. 969.

149 B. F. Coombs & Bro. Commission Co. v. Block, 130 Mo. 668, 32 S. W. 1139.

150 Huber Mfg. Co. v. Piersall, 150 Ky. 307, 150 S. W. 341; Plano Mfg. Co. v. Kesler, 15 Ind. App. 110, 43 N. E. 925; Sandwich Mfg. Co. v. Feary, 34 Neb. 411, 51 N. W. 1026; Northwest Thresher Co. v. Mehlhoff, 23 S. D. 476, 122 N. W. 428. Compare Housding v. Solomon, 127 Mich. 654, 87 N. W. 57.

151 Miller-Stone Mach. Co. v. Balfour, 25 Tex. Civ. App. 413, 61 S. W. 972.

will then have a reasonable time in which to return the article and cancel the sale.152

§ 195. Acceptance and Use of Defective Article.-If an article delivered in pursuance of a contract of sale is defective, or inferior in quality to that which was contracted for, but the buyer nevertheless uses it and treats it as his own, or retains it for an unreasonable length of time in his use and possession, without notifying the seller of his objections to it, this will amount in law to a waiver of such objections and will preclude the buyer from afterwards rescinding the sale.153 An exception to this rule, however, may be found in the case where the buyer's retention and use of the article are induced by the seller's repeated promises to make it good. Thus, a machine having been bought under a contract which provided that, if it was defective, it might be returned at the end of the season, but not afterwards, the buyer retained it until the next season, although he knew it to be defective, upon the promise of the seller's agent that it should be made to do good work then. It was held that this was not a new contract (which the agent might not have authority to make), but only a waiver of the provision in the original contract, and that the purchaser might afterwards sue thereon.154 And further, though the buyer's retention and use of the article may prevent him from rescinding, it does not follow that he is without remedy for the breach of contract. Thus, where plaintiff sold cattle to defendant, who gave notes therefor and further agreed to furnish plaintiff certain quantities of fresh milk, and by a subsequent agreement plaintiff agreed to allow a rebate of $300 if the defendant should faithfully perform his contract, it was held that the plaintiff did not, by accepting and using the milk each day, waive his right to refuse

152 Seiberling v. Brauer, 24 Neb. 510, 39 N. W. 591.

153 Henderson Elevator Co. v. North Georgia Milling Co., 126 Ga. 279, 55 S. E. 50; Kerr v. Smith, 5 B. Mon. (Ky.) 552; Stone v. Russell, 13 Ky. Law Rep. 970; Pierce Steam Heating Co. v. A. Siegel Gas Fixture Co., 60 Mo. App. 168; Acme Harvester Co. v. Carroll, 80 Neb. 594, 114 N. W. 780; Northwest Thresher Co. v. Mehlhoff, 23 S. D. 476, 122 N. W. 428. And see, infra, §§ 595, 596.

184 Osborne v. Flood, 11 Ill. App. 408.

the rebate on account of defendant's breach of the contract in furnishing milk which was unfit for use.155 In another case, the seller of a machine agreed to give to the purchaser a satisfactory bond to indemnify him against interference by one who claimed that the machine was an infringement on his patent. And it was held that, after the buyer had used the machine for several months, though he could not then insist on such a bond as a condition precedent to his liability for the price, still he could recoup the damages sustained by the seller's failure to give it.156

155 Carpenter v. Crow, 77 Ark. 522, 92 S. W. 779.

156 Young Bros. Machine Co. v. Young, 111 Mich. 118, 69 N. W. 152.

199.

Performance Not in Accordance with Terms.

200. Defective or Unsatisfactory Performance of Work.

201. Excuses for Default.

202. Refusal of Performance.

203. Anticipatory Breach of Contract.

204. Declared Intention Not to Perform.

205. Performance Prevented by Wrongful Act of Other Party. 206. Inability to Perform.

207. Insolvency of Purchaser.

208. Impossibility of Performance.

209. Same; Destruction or Perishing of Subject-Matter.

210. Effect of Party's Disabling Himself to Perform.

211.

212.

213.

214.

Sale of Subject-Matter to Third Party.

Breach of Covenant or Condition, in General.

Same; Conditions Subsequent; Promise of Future Action.
Non-Payment of Consideration.

215. Payment or Delivery in Installments.

216. Failure of Punctual Performance; Time of the Essence. 217. Same; Failure to Deliver or Perform at Time Stipulated. 218. Same; Unreasonable Delay in Delivery or Performance. 219. Same; Waiver or Extension of Time.

220. Same; Penalty Fixed for Delay.

§ 196. Non-Performance as Ground of Rescission.-The mere breach of a contract does not amount to fraud, nor is it proof of fraud existing at the time the contract was made, and neither knowledge of one's inability to perform a contract nor an intention not to perform it will make the transaction fraudulent.' But aside from questions of fraud, it is a general rule that if a contract is entire and remains executory in whole or in part, and one party fails to perform what it is his duty to do under the contract, and the other party is not in default, the latter may rescind the contract.2

1 Miller v. Sutliff, 241 Ill. 521, 89 N. E. 651, 24 L. R. A. (N. S.) 735; John Blaul & Sons v. Wandel, 137 Iowa, 301, 114 N. W. 899.

2 Skillern v. May, 4 Cranch, 137, 2 L. Ed. 574; Fore River Shipbuilding Co. v. Southern Pac. Co., 219 Fed. 387, 135 C. C. A. 129; Martin v. Chapman, 6 Port. (Ala.) 344; Bacon v. Green, 36 Fla. 325, 18 South. 870; Brewster v. Van Liew, 20 Ill. App. 43; Cromwell v.